Oil prices drop below $80pb as OPEC, others end meeting

The prices of oil, yesterday, dropped below $80 per barrel in the global market as the Organisation of Petroleum Exporting Countries, OPEC, International Energy Forum, IEF and International Energy Agency, IEA, ended their explosive workshop.

Checks by Vanguard indicated that the prices of crudes, including Nigeria’s Bonny Light, United Kingdom’s Brent and OPEC Basket, dropped to $79.79, $78.04 and $79 per barrel respectively, from over $80 recorded the previous day.

Market watchers said the drop remains insignificant as many nations, especially Nigeria, which had benchmarked its 2023 budget at $75 per barrel and 1.8 million barrels per day, including condensate would still be able to generate adequate revenue.

In a telephone interview with Vanguard, Executive Director, Emmanual Egbogah Foundation, Prof. Wuni Iledare, said: “There is no need to panic at this stage. From all indications, the trend in crude oil prices is upward bound.”

Similarly, Lead Promoter, EnergyHub Nigeria, Prof. Felix Amieyeofori, said: “For a greater part of 2023, oil prices would hover at between $80 and $100 per barrel.”

Despite their differences, IEA, IEF and OPEC which held the 9th Joint IEA-IEF-OPEC workshop on the Interactions between Physical and Financial Energy Markets, Thursday, expressed commitment to achieving market stability.

The high-level meeting was chaired by Dr. Ayed S. Al-Qahtani, Director of OPEC’s Research Division, together with IEF Secretary General, Joseph McMonigle, and Ms. Toril Bosoni, Head of the IEA’s Oil Industry and Markets Division.

In pre-recorded welcoming remarks, OPEC Secretary General, HE Haitham Al Ghais, said: “What this past year has shown us is the need for the continued monitoring of factors driving volatility in energy-related financial markets, and how it can impact not only the short term, but the medium and long term too.”

He highlighted that, when required, OPEC Member Countries and their partners within the ‘Declaration of Cooperation’ have “undertaken extraordinary efforts to stabilize the oil market in these extraordinary times, in the interests of producers, consumers, the oil industry and the wider global economy.

This is on the physical side of the oil market. On the financial side, we have been observing an accelerated trend in speculative trading, with investors and other players trading futures and options at faster rates, sometimes severely impacting market liquidity and hindering price discovery mechanisms.”